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Saturday, February 12, 2011

Mark Lemley: Point of Novelty

Posted by
Lisa Larrimore Ouellette

Who knew that there were so many novel things to say about novelty! In an earlier post, I described Sean Seymore's argument that the novelty test is too strict for complex inventions. This post examines how Mark Lemley (Stanford Law, and the most cited IP prof) criticizes novelty doctrine in a more fundamental way in Point of Novelty. Lemley argues that although "the goal of the patent system is to encourage new invention," "[p]atent law today goes out of its way to avoid focusing attention on ... the point of novelty of the invention." He argues that courts should focus on the point of novelty when assessing patents.

Lemley notes that patent claims used to describe the new features of the invention ("central claiming"); it was only around 1870 that courts shifted to interpreting claims as defining an invention's boundaries ("peripheral claiming"), a trend that has accelerated with the decline of "Jepson" claims and the Markman decision that interpreting claims is a question of law. Patentees today rarely identify the point of novelty of their inventions; for example, patent claims for a 4-step process will not tell you if only one of those steps is new.

The insistance that there is no point of novelty of an invention developed out of cases in which courts had to determine whether combination inventions (where the novelty lies in the combination) are obvious, but the rule has spread to other patent doctrines, including anticipation, subject matter, best mode, claim construction, infringement, and damages. Lemley notes some areas where the point-of-novelty approach survives, but the most interesting section of his paper is II.B, with examples of where he believes "the no-point-of-novelty doctrine leads [courts] astray":

Repair vs. reconstruction. In Aro v. Convertible Top, the Supreme Court "held that car owners could bypass the patent on convertible top assemblies by replacing what is arguably the most important part of the top an unlimited number of times," which "allowed a third party supplier to capture a significant part of the value supposedly resident in the invention."

Written description. Although "[t]he most reasonable theory" for having a separate written description requirement is "to prevent 'late claiming' by a patentee who changes her claims during the prosecution process to cover things she didn't actually understand," "subsequent Federal Circuit decisions have used the no-point-of-novelty rule to read ... the late-claiming concern ... out of written description law."

Best mode. The no-point-of-novelty rule exacerbates the problem of best mode being "a potential trap for the unwary." Under current doctrine, "the court would invalidate a patent on the car with intermittent windshield wipers if the inventor did not disclose her preferred brand of tires, a rather extreme requirement."

Infringement. "[A] defendant can avoid infringement by eliminating any one of those elements [of the patentee's invention], even if it appropriates the point of novelty ... in its entirety."

At this point, Lemley addresses the question that his examples raised for me: "If patent owners can hamstring themselves by including prior art elements in their patent claims, why do they do it?" His answer: Much of it is related to damages being calculated as a percent of the sales of the relevant product. "[I]f the inventor of the intermittent windshield wiper claims a windshield wiper, his damages in a lawsuit will be measured by the sale of windshield wipers. But claim the identical invention as a car with an intermittent windshield wiper as an element, and the royalty base is the sale of cars – a much larger number."

But is this really a problem? If all the inventor made was a windshield wiper, why should his royalty base be a car? Doesn't the no-point-of-novelty doctrine help prevent overreaching by patentees? Perhaps Lemley would respond that damages should also be calculated based on the point of novelty, but he doesn't address this question. I do think he is right, however, in his conclusion to this section: "The heart of the problem may be the law's focus on the language of lawyer-created claims rather than inventor-created technologies."